Europe: Faurecia mulling sale of bumpers unit

According to a recent report from Bloomberg, Faurecia SA, Europe’s largest maker of car interiors has envisioned a sale of its bumpers business, citing sources that have knowledge of the matter.

According to the report the division might be valued at around $450 million, with the supplier negotiating sale terms with private-equity firms and automotive suppliers in order to get a feel of the level of interest in the market. The French company, majority owned by PSA Peugeot Citroen, the second largest European automaker, has also asked Citigroup Inc to work on a potential dispute. Faurecia has been mulling a sale of the unit for quite some time now, but has not yet decided firmly if it will go through with the divestment and can still opt to hold on to the bumpers business if a buyer doesn’t meet the asking price. For example, the company has sought a bidder for its front-end modules division for at least a year, but recently opted to keep the unit.

The sources, who asked to remain anonymous because the talks are held behind closed doors, said the bumpers business, part of the smaller Faurecia division that makes parts for the exterior of cars, could yield as much as $450 million. Dropping the bumpers unit could bring for the company much needed financial assistance and free up resources to willingly expand its ventures in Asia. The auto parts manufacturer wants to open an average of seven factories per year in China, where it envisions double the current revenue by 2018.